OFG Bancorp (OFG) risk factors, FY2025 10-K

Other

1. 01Most of our business is conducted in Puerto Rico, where economic and government fiscal and liquidity challenges have adversely impacted and may continue to adversely impact us
2. 02Puerto Rico and the USVI are susceptible to earthquakes, hurricanes and major storms, the severity of which could be heightened by the effect of climate change, which could further deteriorate their economy and infrastructure
3. 03Puerto Rico depends on federal disaster relief funds and any prolonged delay in disbursements of such funds could adversely affect the local economy
4. 04Potential adverse effects of political changes may disrupt the economic recovery process in Puerto Rico
5. 05Adverse developments in federal trade policy and the phasing-out of federal emergency and stimulus funds may impact our business and stock priceNew
6. 06Changes in interest rates could adversely affect OFG’s results of operations and financial condition45% rewritten
7. 07Heightened credit risk could require us to increase our provision for credit losses, which could have a material adverse effect on our results of operations and financial condition
8. 08Our emphasis on the origination of commercial and retail loans is one of the more significant factors in evaluating our ACL. As we continue to increase the amount of these loans, additional or increased provisions for credit losses may be necessary and as a result would decrease our earnings
9. 09We are subject to default and other risks in connection with mortgage loan originations
10. 10A decline in the real estate market would likely result in an increase in delinquencies, defaults and foreclosures and in a reduction in loan origination activity, which would adversely affect our financial results24% rewritten
11. 11assets may increase if Puerto Rico’s economy enters into a recession, or if there is a decline in economic activity, additional increases in the ACL could be necessary with further adverse effects on our profitabilityNew
12. 12Global armed conflicts may impact all aspects of our operations, revenues, costs and stock price
13. 13We may experience losses related to fraud and theft
14. 14We are subject to security and operational risks related to our use of technology, including the risk of cyber-attack or cyber theft30% rewritten
15. 15security. Such an event could compromise our confidential information, as well as that of our customers and third parties with whom we interact with and may result in negative consequencesNew
16. 16We rely on third parties to provide services and systems essential to the operation of our business, and any failure, interruption or termination of such services or systems could have a material adverse effect on our financial condition and results of operations
17. 17Non-Compliance with the USA Patriot Act, Bank Secrecy Act, or other laws and regulations could result in fines and other sanctions
18. 18Consumer protection laws may reduce our noninterest income
19. 19Our risk management policies, procedures and systems may be inadequate to mitigate all risks inherent in our various businesses
20. 20Adverse developments in the financial services industry could adversely affect our financial condition and results of operations
21. 21Our business could be adversely affected if we cannot maintain access to stable funding sources
22. 22Our ability to receive dividends from our subsidiaries could affect our liquidity and ability to pay dividends to our shareholders
23. 23Failure to keep pace with technological change, including developments in artificial intelligence, could adversely affect OFG’s results of operations and financial condition71% rewritten
24. 24Competition with other financial institutions could adversely affect our profitability68% rewritten
25. 25We operate in a highly regulated industry and may be adversely affected by changes in federal and local laws and regulations
26. 26Reputational risk and social factors may impact our results
27. 27Our adoption of artificial intelligence technologies exposes us to evolving legal, regulatory, and operational risksNew
28. 28Changes in accounting standards issued by the Financial Accounting Standards Board (“FASB”) or other standard-setting bodies may adversely affect our financial statements
29. 29Our goodwill and other intangible assets could be determined to be impaired in the future and could decrease OFG’s earnings
30. 30Legislative and other measures that may be taken by Puerto Rico governmental authorities could materially increase our tax burden or otherwise adversely affect our financial condition, results of operations or cash flows